06-09 - TAX MIA QE SEPT 2006 ANSWER 1(1(a Computation of...

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TAX MIA QE / SEPT 2006 CONFIDENTIAL 1 ANSWER 1 (1) (a) Computation of Tax Payable for Factor Sdn Bhd YA 2006 RM RM + - Sec 4(a): Net profit before taxation 1,744,500 (-) Other income: Interest (1) 35,000 Dividend (2) 1,521,000 Rental (3) 30,000 Adjustments: Cost of sales (4) Stock obsolescence 22,000 Insurance (no double deduction) NIL Damaged goods written off NIL Remuneration (5) Disabled employee (double deduction) 54,000 Unemployed graduate (no double deduction) NIL EPF 157,500 – 19% (600,000 + 150,000)15,000 Bonus NIL Expatriate employee NIL Unapproved fund 9,600 Staff welfare (6) Staff medical and dental benefits NIL Child care maintenance NIL Loan to employees 110,000 Leave passage for directors 35,000 Freight and insurance (7)(double deduction) 120,000 General and Administration (8) Compensation to ex-staff NIL Annual subscription to Trade Associaton NIL Traffic fine 7,500 Food – annual general meeting 150,500 Professional charges (9) Legal fees – trade debt NIL Legal fees – tax appeal 9,000 Renewal of trade mark NIL Staff recruitment NIL Business zakat 45,000 Repair and maintenance (10) Extension – factory porch 67,500 Upgrading protection system 31,500
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TAX MIA QE / SEPT 2006 CONFIDENTIAL 2 Director’s motor vehicle expenses NIL Resurfacing – factory car park NIL Depreciation on fixed assets 48,000 Entertainment (11) Dinners – client (50%) 21,000 Lunch – employees NIL Sponsorship – local (mx 300,000) 15,000 Cost of souvenirs 66,500 Leasing (12) 14,800 Donation (13) Equipment 2,000 Cash 6,000 Miscelleneous (14) Stamp duty 8,000 Forex gain (unrealised) 22,000 Forex loss (realised) 47,000 2,408,900 1,848,500 (1,848,500) Adjusted Income 560,400 (-) Capital allowance: Current year = 215,000 Brought forward = 13,500 Factory protection system (20%+10%x31,500) = 9,450 (237,950) Statutory Income 322,450 (-) Brought forward business loss- sec 43(2) (35,550) 286,900 Add: Other Income Interest (exempt) NIL Rental (exempt) NIL Dividend – gross (700,000 + 500,000)1,200,000 Aggregate Income 1,486,900 (-) Approved donation (cash and kind) – not qualified NIL (-) Business zakat (mx 2.5% x Aggregate Income) {45,000 subject to 2.5% x 1,486,900) (37,172.5 ) Total/Chargeable Income 1,449,727.5 Tax on the 1 st 500,000 @ 20% = RM100,000 Tax on the balance 949,727.5 @ 28% = 265,923.7 365,923.7 (-) Sec 110 Tax Credit [196,000 + 140,000) (336,000) Tax Payable RM29,923.7 (15 marks)
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TAX MIA QE / SEPT 2006 CONFIDENTIAL 3 (b) Section 108 A/C – YA 2006 (1/9/05 – 31/8/06) RM RM Sec 108 b/f 1/9/05 546,000 (+) Tax paid in YA 06: 12 th instalment for YA 2005 22,500 Final tax for YA 2005 120,000 Instalment for YA 2006 (11 x 24,000) 264,000 406,500 952,500 (+) The lower of: Tax credit sec 110 = 84,000 or Tax charged (28% x 1,260,000) = 352,000 84,000 Compared Aggregate 1,036,500 Compared Total (Tax on dividend paid) 1/11/05
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06-09 - TAX MIA QE SEPT 2006 ANSWER 1(1(a Computation of...

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